Milton Friedman On Monetary And Fiscal Policy

I found this passage from Milton Friedman in 1958, as seen on John B. Taylor’s blog, to be notable, especially given the immense monetary and fiscal policy actions taken to “improve” our economic situation: “The available evidence…casts grave doubt on the possibility of producing any fine adjustments in economic activity by fine adjustments in monetary … Read moreMilton Friedman On Monetary And Fiscal Policy

Keynesian Theory – A Few Comments

Up to this point, I have yet to mention “Keynes” or any derivative thereof.  The reason for this is simple – I don’t believe that the efforts taken to stimulate the economy are reflective of the theories that Keynes espoused.  Instead, they are a type of “bastardized” Keynesian Theory – used by various parties in … Read moreKeynesian Theory – A Few Comments

The Effectiveness Of Stimulus

“One of the biggest economic myths since the Great Depression is that governments can ameliorate or counteract the ebbs and flows of free markets. Government spending has never worked as a trigger for sustained and vibrant economic growth. Ever. Scholarship has demonstrated that the New Deal perpetuated the Depression rather than cured it. On the … Read moreThe Effectiveness Of Stimulus

The Quality Of Deficit Spending

In the Wall Street Journal on Saturday, February 13 there was an editorial titled “High-Speed Spending.”  This discussed the dubious financial dynamics of a long-proposed “high speed” Orlando-to-Tampa rail project. I also heard of a proposal to do a similar project between St. Louis and Chicago. I have lived in the Chicago area for most … Read moreThe Quality Of Deficit Spending

Unemployment And Stimulus

Here is a Wall Street Journal editorial from Monday: http://online.wsj.com/article/SB10001424052748703298004574459341050610398.html I found it interesting for two reasons.  First, it has a chart that shows the actual Unemployment Rate vs. that forecast in “The Job Impact of the American Recovery and Reinvestment Plan.”  Currently the Unemployment Rate is approximately 2% above the rate forecasted with the stimulus. Second, the editorial … Read moreUnemployment And Stimulus

“Cash For Clunkers” Revisited

Here is an October 5 Wall Street Journal editorial reviewing the “Cash For Clunkers” stimulus plan: http://online.wsj.com/article/SB10001424052748703628304574453280766443704.html Also, to provide perspective, a chart of Vehicle Sales from the CalculatedRisk blog (10/1 post) at this link: http://www.calculatedriskblog.com/2009/10/light-vehicle-sales-92-million-saar-in.html As one can see, the “Cash for Clunkers” seems to have been successful in temporarily causing a surge in auto sales for July and … Read more“Cash For Clunkers” Revisited

“Stimulus Spending Doesn’t Work” Op-Ed

Here is an October 1 op-ed in The Wall Street Journal titled “Stimulus Spending Doesn’t Work” : http://online.wsj.com/article/SB10001424052748704471504574440723298786310.html Although I don’t concur with some of the statements in this Op-Ed, I do believe that its overall message and conclusions are important.   SPX at 1054.72 as this post is written